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Scotland: Hermes push to merge poor investment trusts

HERMES Focus Asset Management plans to agitate for mergers and acquisitions of underperforming investment trusts following the decision by Sir Angus Grossart to stand down soon as chairman of Scottish Investment Trust (SIT).

The company had planned to oppose Grossart’s re-election as chairman of SIT at Friday’s annual meeting because he has led the board three times longer than the nine years that guidelines recommend, but abstained when he announced he planned to give up the role soon.

Hermes, which has invested £900m in investment trusts, says the weakest should be taken over by stronger rivals or merged with better performers.

Hermes’ many investments include a large shareholding in the £800m SIT and in Edinburgh Fund Managers (EFM), which manages a number of investment trusts.

Hermes has led a long campaign for board changes at EFM, which ended with Grossart and a number of other directors leaving the EFM board.